It's Friday night, and you are just about to leave your room to attend a party. However, a copy of the New York Times catches your eye. More specifically, there's an article about champagne. The article describes a successful marketing campaign by the champagne industry that changed consumers' tastes for champagne. The article notes that "many executives felt giddy about the stratospheric champagne prices that resulted. But they also feared that such sharp price increases would cause demand to decline, which would then cause prices to plunge."
At the party, your boss has read the same New York Times article and talks to you about champagne. She knows that you are currently taking economics, but she has never taken any economics. She wants to know if the analysis of the situation by the executives reported in the article is actually correct and what elements should additionally be discussed. What would you stay to your boss?© BrainMass Inc. brainmass.com October 17, 2018, 11:01 am ad1c9bdddf
What we can deduct from present-day perception of champagne is that the marketing campaign sought to make consumers think of champagne as something refined, luxurious, ...
The solution discusses champagne economics.
Business Economics: Drugmakers Example
It was recently reported in a newspaper article entitled "Drugmakers gifts to doctors finally get scrutiny." The article stated: "Christmas trees, free tickets to a Washington Redskins game with a champagne reception thrown in, a family vacation in Hawaii, and wads of cash." Many persons might see this as bribing, but not it seems in the minds of many doctors.
What do you think it is?
Why do you think there is scrutiny at this time?
Can you provide an economic explanation of why the practices described in this article occur?